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Hopefully, you’ve been enjoying this blog series thus far! Part 1 summarized the “Moneyball” theme and went further into how data can aid your pre-admissions process and targeted clientele. Part 2 dove into how tracking performance is critical to successful outcomes, reputation, and profitability. Now, let’s examine how data for specific payor types and PDPM can really help your operation.

How Long Is the Season?

We’ve mentioned length of stay before, but now it’s time to call it out as its own area to drive performance indicators.

  1. Average versus total length of stay. Look at the average across all payor types. Being able to drill down by payor type will help ensure the anticipated reimbursement.
  2. Moving into PDPM. Understanding the payor mix becomes even more critical than before. Many states pay less than 80% of allowable costs for Medicaid reimbursement, and the shortfalls for Medicaid per diem rates range from $9 to $63 a day. For the 25 states that use a case-mix system for Medicaid, the major challenge will be transitioning to a model without the old Resource Utilization Group (RUG).

“If you have a 50/50 mix of Medicaid/Medicare and you are heavily weighted in length of stay by Medicaid – you can expect a two to four percent loss in revenue unless you have some type of special services. Average versus total helps you identify potential income matched to actual reimbursement to see where losses are occurring.” – Brian Ellsworth, Vice President of Public Policy and Payment Transformation at the consulting firm Health Dimensions Group.

Risk-Adjusted Readmission

If residents are being discharged in less than 30 days, you need to know why. What are the driving factors and what does this do to your outcomes and sustainability?

  1. Are you accepting individuals with such high acuity that you are not able to maintain clinical stability or take care of their clinical needs in your facility and thus send them out to other providers? Being able to slice and dice the information can be the difference between sustainability and financial challenges – both of which will impact your ability to discharge people back into the community with positive outcomes.
  2. The difference between the risk-adjusted rate and the regular rate is an important distinction. Managing your high-risk residents on the different data points – payor, referring facility diagnosis, etc., – allows you better manage staffing, costs, treatments, and your financial risk. It is important to understand and monitor clinical conditions:
    1. Dementia
    2. CHF
    3. Infections
    4. Deep Tissue Injury
    5. Surgical Wound/Surgical History
    6. Swallowing or Chewing disorders
    7. Vent or Tracheostomy
    8. Behavioral/Psych

It Matters More Now

With the implementation of PDPM on October 1, 2019, Primary Diagnosis means even more now than in the past. This is an area where the more data you have, the better you can slice and dice it to get to meaningful information and then take needed action.

While this is not new, it is even more critical than before to capture this information prior to admission. It is also important to now consider referral software that can help you access the information in near real-time so that your clinical admissions personnel can make the most informed decision possible.

With PDPM, most providers have welcomed the reduction in resident assessments for therapy. While RUG-IV mandated at least five assessments over a 90-day stay, under PDPM many patients will need just two: the initial MDS completed within eight days of admission and a resident discharge assessment tied to the last day of stay. With the change, it might seem that less data needs to be collected, but the opposite is likely to be true.

You will want to get data about:

  • Age
  • Referring hospital
  • Clinical condition and comorbidity
  • Discharge
  • Discharge payor
  • Total and average length of stay

New MDS items under PDPM will require your staff to be keyed into all the comorbidities that make up the individual’s case mix. Having this information and data matters, as once it has been recorded on the 5-MDS Assessment, there is no way to add or adjust resident characteristics without a significant change in status.


Understanding the key data points and how to turn them to information you need can be the difference between surviving as a facility or building a long-term sustainable business – in Moneyball parlance, it means using data to make it in the major leagues. More importantly, it can make the difference in your resident outcomes.

The most important data you have comes during the resident handoff. Failure to understand and utilize the information can generate a host of healthcare and financial difficulties. Providers who lack the full picture run the risk of negative outcomes, poor survey results, lower star ratings, and financial hardship.